Sorry about the last blog--I saved only part of it and when I finished it, I was interrupted for about 30 minutes and I guess it timed out. However, I finished it again yesterday.
Now back to today's blog. Where have all the small motorhomes gone? Today I found out that Newmar is discontinuing the 40' Mountain Aire. Seems that the new 2011 Mountain Aire has been a huge hit, but only in the 43' floorplans. While they've sold several dozen of the 43' versions since its introduction in January, they have yet to have taken even one order for the two 40' versions offered.
This got me to thinking about how the motorhome market has evolved over the last 20 or 30 years. Consumers tastes drive the market, but oh how they've changed! Seems most now want them bigger, with more slides and even more amenities.
Back in the early eighties, I started selling a few diesel pushers. I remember selling a current Newmar owner a 34 or 36 foot Sun Voyager with no slide, and get this, a 190 HP Cummins! It sold somewhere around $75K.
Newmar pioneered the slide out in a motorhome in their 1989 models. The 38' Kountry Star had a slide and a 225 HP engine. I remember there was an upgrade option to go to the huge 250 HP! You would have to spend around $100K for it. If you wanted a 300 HP or more you had to with a $200K or $300K coach.
For several years, Newmar was the only manufacturer to have slide-outs in their motorhomes. Everyone said there was too much liability attached to having a big hole in the side of a motorhome. I remember sitting at a table of Fleetwood motorhome engineers at a Fleetwood dealer meeting in the early nineties (We handled Fleetwood's Coleman tent trailers at the time) and asking them when Fleetwood was going to come out with a slide on their motorhomes. That question was met with a round of laughter and a reply of "Never! They're just asking for trouble and I guarantee you it will come back to haunt Newmar. It's just crazy!" By the mid-nighties almost everyone was offering motorhomes with slides. There were a few laggards and they paid a steep price as they lost market share and some even went out of business.
In 1999, Newmar introduced the 2000 4095 Dutch Star with a double slide. It had a 300 HP engine. It was a huge hit as it sold in the $125K area. The previous Dutch Stars were 38 footers, but before long everyone was selling more 40 footers than 38's.
2 or 3 years later Newmar added a couple of triple slide models. Engines were 350 HP standard with an option to go to a 370 HP on the Spartan chassis. By the mid-2000's we were seeing quad slide models and the 38 foot models discontinued except with the Kountry Star.
We still sold a lot of 2 slide models back then as some customers made the argument that they liked not having slides on the doorside, because it prevented them easy access to their baggage compartments. That was true, but soon the 2-slide models were omitted from the line-up as sales dwindled and shifted to the 4 slide models.
About the same time, 43 foot models were introduced and they came with a tag axle and a 400 HP engine. They were bigger, had more power, had a smoother ride and were only about $25K more. Previously, you had to go to an Essex or Mountain Aire to get even a tag axle. We've seen sales climb on the tag axles until they represent about 90% of our sales today. They all have at least 425 HP.
Today, it's hard to sell a used coach with only one slide and even a little difficult to sell those with two slides. Values also plummet on coaches with less than 300 HP. Everyone wants tag axles, 400+ HP, 4 slides and in a lot of cases, Comfort Drive as word gets around.
Somewhat the same thing with gas coaches. Everyone wants the big coach with lots of slides. The extra slides have added weight so that it requires a heavier chassis. That, in turn, has added cost--so much so that high line gas motorhomes get pretty close to the entry-level diesel's cost. Ten years ago we sold approximately 10 gas motorhomes to every 1 diesel. Now, that's reversed!
So, what can we look forward to in the future? Maybe the new 450 HP engine is the old 300 HP. Is today's 43' the old 38' and the new 45' the old 40'? Will Comfort Drive be as common on all diesel motorhomes as hydronic zone heating is today? Will full-wall slides be the next must-have?
I don't know those answers now. I don't know about you, but I can't wait to find out! Lee
Now back to today's blog. Where have all the small motorhomes gone? Today I found out that Newmar is discontinuing the 40' Mountain Aire. Seems that the new 2011 Mountain Aire has been a huge hit, but only in the 43' floorplans. While they've sold several dozen of the 43' versions since its introduction in January, they have yet to have taken even one order for the two 40' versions offered.
This got me to thinking about how the motorhome market has evolved over the last 20 or 30 years. Consumers tastes drive the market, but oh how they've changed! Seems most now want them bigger, with more slides and even more amenities.
Back in the early eighties, I started selling a few diesel pushers. I remember selling a current Newmar owner a 34 or 36 foot Sun Voyager with no slide, and get this, a 190 HP Cummins! It sold somewhere around $75K.
Newmar pioneered the slide out in a motorhome in their 1989 models. The 38' Kountry Star had a slide and a 225 HP engine. I remember there was an upgrade option to go to the huge 250 HP! You would have to spend around $100K for it. If you wanted a 300 HP or more you had to with a $200K or $300K coach.
For several years, Newmar was the only manufacturer to have slide-outs in their motorhomes. Everyone said there was too much liability attached to having a big hole in the side of a motorhome. I remember sitting at a table of Fleetwood motorhome engineers at a Fleetwood dealer meeting in the early nineties (We handled Fleetwood's Coleman tent trailers at the time) and asking them when Fleetwood was going to come out with a slide on their motorhomes. That question was met with a round of laughter and a reply of "Never! They're just asking for trouble and I guarantee you it will come back to haunt Newmar. It's just crazy!" By the mid-nighties almost everyone was offering motorhomes with slides. There were a few laggards and they paid a steep price as they lost market share and some even went out of business.
In 1999, Newmar introduced the 2000 4095 Dutch Star with a double slide. It had a 300 HP engine. It was a huge hit as it sold in the $125K area. The previous Dutch Stars were 38 footers, but before long everyone was selling more 40 footers than 38's.
2 or 3 years later Newmar added a couple of triple slide models. Engines were 350 HP standard with an option to go to a 370 HP on the Spartan chassis. By the mid-2000's we were seeing quad slide models and the 38 foot models discontinued except with the Kountry Star.
We still sold a lot of 2 slide models back then as some customers made the argument that they liked not having slides on the doorside, because it prevented them easy access to their baggage compartments. That was true, but soon the 2-slide models were omitted from the line-up as sales dwindled and shifted to the 4 slide models.
About the same time, 43 foot models were introduced and they came with a tag axle and a 400 HP engine. They were bigger, had more power, had a smoother ride and were only about $25K more. Previously, you had to go to an Essex or Mountain Aire to get even a tag axle. We've seen sales climb on the tag axles until they represent about 90% of our sales today. They all have at least 425 HP.
Today, it's hard to sell a used coach with only one slide and even a little difficult to sell those with two slides. Values also plummet on coaches with less than 300 HP. Everyone wants tag axles, 400+ HP, 4 slides and in a lot of cases, Comfort Drive as word gets around.
Somewhat the same thing with gas coaches. Everyone wants the big coach with lots of slides. The extra slides have added weight so that it requires a heavier chassis. That, in turn, has added cost--so much so that high line gas motorhomes get pretty close to the entry-level diesel's cost. Ten years ago we sold approximately 10 gas motorhomes to every 1 diesel. Now, that's reversed!
So, what can we look forward to in the future? Maybe the new 450 HP engine is the old 300 HP. Is today's 43' the old 38' and the new 45' the old 40'? Will Comfort Drive be as common on all diesel motorhomes as hydronic zone heating is today? Will full-wall slides be the next must-have?
I don't know those answers now. I don't know about you, but I can't wait to find out! Lee
03/02: Newmar Owner Loyalty Rebate
Newmar just emailed me a new program for March. On any Essex order or purchase from a dealer's stock during the month of March will be eligible for a cash rebate of $20,000 if you are an existing owner of a Newmar product! 5th wheel or motorhome will be eligible. If you own a competitor's product, you can claim a $15,000 rebate!
The rebate can be sent to the customer or can be applied to the deal. The rebate won't be released until the new Essex is paid for. If a stock unit is purchased (can be a 2010 or older) the dealer will have to reorder to get the cash rebate. No reorder is required if special ordered for a customer.
This is great news that should shake up a lot of fence sitters. We are already working a lot of Newmar Essex deals and this should add fuel to the fire. In fact, the last time I had so many Newmar deals working at the same time was 5 or 6 years ago! This matches up with RVIA reporting today that wholesale shipments for January more than doubled from January, 2009.
Go camping more--have more fun! Lee
The rebate can be sent to the customer or can be applied to the deal. The rebate won't be released until the new Essex is paid for. If a stock unit is purchased (can be a 2010 or older) the dealer will have to reorder to get the cash rebate. No reorder is required if special ordered for a customer.
This is great news that should shake up a lot of fence sitters. We are already working a lot of Newmar Essex deals and this should add fuel to the fire. In fact, the last time I had so many Newmar deals working at the same time was 5 or 6 years ago! This matches up with RVIA reporting today that wholesale shipments for January more than doubled from January, 2009.
Go camping more--have more fun! Lee
01/26: Tom & Diane Conerty
As many of you know, Tom and Diane Conerty were employed by Lee's RV and before that, Mountain States RV, for many years to represent us at rallies. They were always at the Newmar International Rally, Quartzsite and others.
Sadly, Diane Conerty passed away in late November after being diagnosed with bone cancer only a couple of months before. The Myeloma cancer she had was incurable, but highly treatable in most cases. Unfortunately, she developed complications from the treatment as was gone before anyone was ready.
Tom is one of the most gregarious, upbeat people you will ever meet. He is sort of a modern day Will Rogers--he's never met a man he didn't like. His customers become his friends--for life. He will do most anything to help his friends.
Of course, his wife's death has thrown him for a loop. It was exhausting to do 3 "Celebrations of Life" in 3 different states. He had so little time to prepare for her death--in fact, after the cancer diagnosis they prepared to go on with life in as normal a fashion as they could. That meant they were to continue RVing and spending time with their RV family and friends.
Everyone deals with grief in different ways. There is no wrong way to grieve. The range could be from a few weeks of being stunned, but otherwise acting "normal", up to a spiral into severe depression, lasting many years.
I've visited with Tom and he is determined to do what he thinks Diane would want--and that is to try his best to get back to normal and go on with life. For a person with Tom's personality, that requires lots of interaction with people. While he gets to see his many friends at the RV resort, he still notices that many people are hesitant to contact him. He thinks it's because they really don't know what to say to him and feel uncomfortable.
Tom likes to be doing something all the time. He loves talking to potential customers and helping solve his customer's problems. He tells me that being busy helps keep his mind off things and helps with the healing process. He really wishes more of his friends and acquaintances would treat him normal--call him, stop by, refer friends to him, etc. He doesn't like them to be afraid to call him.
I guess what I'm trying to say is that Tom is my friend and I'm trying to help my friend with the grieving process. This is the best way I know to get the word out. If you know Tom or have been referred to him, don't be afraid to give him a call. He really wants to get back to normal and would appreciate a call. If you prefer email, it's tdconerty@earthlink.net If you need his number, drop me an email at lee@leesrv.com.
Go camping more--have more fun! Lee
Sadly, Diane Conerty passed away in late November after being diagnosed with bone cancer only a couple of months before. The Myeloma cancer she had was incurable, but highly treatable in most cases. Unfortunately, she developed complications from the treatment as was gone before anyone was ready.
Tom is one of the most gregarious, upbeat people you will ever meet. He is sort of a modern day Will Rogers--he's never met a man he didn't like. His customers become his friends--for life. He will do most anything to help his friends.
Of course, his wife's death has thrown him for a loop. It was exhausting to do 3 "Celebrations of Life" in 3 different states. He had so little time to prepare for her death--in fact, after the cancer diagnosis they prepared to go on with life in as normal a fashion as they could. That meant they were to continue RVing and spending time with their RV family and friends.
Everyone deals with grief in different ways. There is no wrong way to grieve. The range could be from a few weeks of being stunned, but otherwise acting "normal", up to a spiral into severe depression, lasting many years.
I've visited with Tom and he is determined to do what he thinks Diane would want--and that is to try his best to get back to normal and go on with life. For a person with Tom's personality, that requires lots of interaction with people. While he gets to see his many friends at the RV resort, he still notices that many people are hesitant to contact him. He thinks it's because they really don't know what to say to him and feel uncomfortable.
Tom likes to be doing something all the time. He loves talking to potential customers and helping solve his customer's problems. He tells me that being busy helps keep his mind off things and helps with the healing process. He really wishes more of his friends and acquaintances would treat him normal--call him, stop by, refer friends to him, etc. He doesn't like them to be afraid to call him.
I guess what I'm trying to say is that Tom is my friend and I'm trying to help my friend with the grieving process. This is the best way I know to get the word out. If you know Tom or have been referred to him, don't be afraid to give him a call. He really wants to get back to normal and would appreciate a call. If you prefer email, it's tdconerty@earthlink.net If you need his number, drop me an email at lee@leesrv.com.
Go camping more--have more fun! Lee
I've confirmed that when Newmar makes the Freightliner switch, they will use Cummins engines exclusively. The last time they used Freightliner for a significant number of models, they were equipped with Cat engines.
I know there are many proponents of the Cat engines, and it's probably like Ford and Chevy. From our vantage point, it seems like there are more Cummins on the road and the Cummins service centers seem to be more familiar with motorhomes than the Cat service centers. That's just what we hear from the large cross-section of diesel owners that come to us. Of course, I'm sure there are many top-notch Cat service centers as well as some poor Cummins centers. But, all in all, we're glad to know we don't have to learn about Freightliner AND a different set of engines.
Go camping more--have more fun! Lee
I know there are many proponents of the Cat engines, and it's probably like Ford and Chevy. From our vantage point, it seems like there are more Cummins on the road and the Cummins service centers seem to be more familiar with motorhomes than the Cat service centers. That's just what we hear from the large cross-section of diesel owners that come to us. Of course, I'm sure there are many top-notch Cat service centers as well as some poor Cummins centers. But, all in all, we're glad to know we don't have to learn about Freightliner AND a different set of engines.
Go camping more--have more fun! Lee
A letter dated January 11, 2010 is going out to all Newmar motorhome dealers. In it, Newmar announces a deal with Freightliner Custom Chassis Corporation (FCCC) to supply chassis for their core diesel products for the calendar year 2010 and beyond. Newmar felt the letter was needed to address their plans on dealing with the new 2010 emission engines. As you may have read in an earlier blog, all engines manufactured after January 1, 2010 are subject to new EPA emissions standards that may affect performance and most certainly affect engine and maintenance costs.
While forming a strategy to deal with the new EPA standards, it was obvious that Newmar would want to manufacture motorhomes with the old engines for as long as possible. It appears that Freightliner has more of these engines available than Spartan. Newmar states that they have been in talks with FCCC for several months, "reviewing changes the company has made to its product portfolio, business processes and support philosophy." The goal of the marriage is to allow the companies to proactively plan for a smooth transition to the new engines as well as to go as long as they can with the old engines.
Freightliner has made a huge investment in the old engines, so Newmar will be able to offer customers a better overall value for a longer term. Even though the 2010 models will still be built for 5 or 6 more months, Newmar feels they will still be able to offer the old engines for awhile into the 2011 model year.
A very exciting part of this deal is that FCCC will be able to offer Comfort Drive steering with the adjustable control! That had been an issue and was a factor with Newmar going exclusively with Spartan a couple a years ago. I have a feeling that FCCC engineers' guarantee to accommodate the Comfort Drive system, plus the number of old engines made available to Newmar, made the decision to go with Freightliner a no-brainer.
Newmar also said that FCCC's "combination of an extensive service network, dedication to customer support and a responsive engineering group" led to their decision. In fact, Newmar has announced that they will build their Ventana, Dutch Star, and Mountain Aire brands exclusively on Freightliner chassis for its 2011 and 2012 model years. (There are a few Spartan chassis available for the all new 2011 Mountain Aire that have the 425 HP engine and carry a $15K discount. After those run out, the MADP will have a 450HP engine on the Freightliner chassis.)
Newmar goes on to say that the Essex and King Aire brands will continue to be offered on Spartan's K2 and K3 chassis, respectively. There are a limited number of Spartan chassis available for the other diesels. In fact, there are only 12 remaining chassis available for the 2010 Dutch Aire and 2011 Mountain Aire. We just got our first MADP and it is awesome! All in all, an exciting time for Newmar!
Go camping more--have more fun! Lee
While forming a strategy to deal with the new EPA standards, it was obvious that Newmar would want to manufacture motorhomes with the old engines for as long as possible. It appears that Freightliner has more of these engines available than Spartan. Newmar states that they have been in talks with FCCC for several months, "reviewing changes the company has made to its product portfolio, business processes and support philosophy." The goal of the marriage is to allow the companies to proactively plan for a smooth transition to the new engines as well as to go as long as they can with the old engines.
Freightliner has made a huge investment in the old engines, so Newmar will be able to offer customers a better overall value for a longer term. Even though the 2010 models will still be built for 5 or 6 more months, Newmar feels they will still be able to offer the old engines for awhile into the 2011 model year.
A very exciting part of this deal is that FCCC will be able to offer Comfort Drive steering with the adjustable control! That had been an issue and was a factor with Newmar going exclusively with Spartan a couple a years ago. I have a feeling that FCCC engineers' guarantee to accommodate the Comfort Drive system, plus the number of old engines made available to Newmar, made the decision to go with Freightliner a no-brainer.
Newmar also said that FCCC's "combination of an extensive service network, dedication to customer support and a responsive engineering group" led to their decision. In fact, Newmar has announced that they will build their Ventana, Dutch Star, and Mountain Aire brands exclusively on Freightliner chassis for its 2011 and 2012 model years. (There are a few Spartan chassis available for the all new 2011 Mountain Aire that have the 425 HP engine and carry a $15K discount. After those run out, the MADP will have a 450HP engine on the Freightliner chassis.)
Newmar goes on to say that the Essex and King Aire brands will continue to be offered on Spartan's K2 and K3 chassis, respectively. There are a limited number of Spartan chassis available for the other diesels. In fact, there are only 12 remaining chassis available for the 2010 Dutch Aire and 2011 Mountain Aire. We just got our first MADP and it is awesome! All in all, an exciting time for Newmar!
Go camping more--have more fun! Lee
Spartan Motors has made major inroads into the RV chassis market this past decade. It is the chassis of choice by many veteran RV'ers, because of performance features, reliability, and Spartan's quick response to customers with a problem.
What many may not know is that Spartan is also is big in the emergency vehicle business. They build firetrucks, custom ambulances and other emergency vehicles for cities across the U.S. Since 2005, Spartan has been a major player in chassis components for military vehicles. They are now a key supplier for the Mine Resistant Ambush Protected program and the Iraqi Light Armored Vehicles.
This is conjecture on my part, but I would think that the government contracts are much more lucrative than the RV market as well as more reliable. In the current administration, what's easier than government money? It makes good business sense to follow the easy money. Hey, when Katrina hit, I was more than happy to sell all my new travel trailer inventory to FEMA at retail!
My point is that Spartan may focus on its military business and RVs may take a back seat. Competitors may also play a role. Some manufacturers are getting into the chassis business. Would Monaco consider selling their Roadmaster chassis to competitors? Doubtful, but who knows as they struggle coming out of bankruptcy? How about Freightliner? Are they ready to go after RV manufacturer's business they've lost such as Newmar?
Newmar's supply of Spartans with the more desirable engines without the new 2010 restrictions is dwindling rapidly. There is a finite number of engines available and Spartan may not have enough to satisfy demand. Newmar may have to look elsewhere and I'm sure, as one of the winners in the RV carnage we saw in the past year, they will have some courtship encounters. This could be bad news if you're a Spartan fan.
If you're considering a diesel pusher in the near future and want a Spartan chassis, you should strongly consider getting a chassis availability count from me or your dealer. Why take a chance on being left out in the cold after finding out the chassis or engine you want is unavailable when you're ready to pull the trigger?
We're seeing more and more buyers kicking themselves that they can't get some of the same deals offered a year ago when the RV market was reeling. When we miss out on a great thing, it's easier still to miss out on a very good thing. For example, it's tough to admit you should have bought that downtrodden stock and then keep missing out as the stock continues to rise. Wow! I could have bought it at $2 and now it's $8!--and quite possibly on its way to $25.
I think we will be seeing soon the second leg of non-buyer's remorse as the manufacturers sell out of the old engines and be forced to buy the new EPA guideline engines at much higher cost and maintenance. Also, the chassis of choice may not be available, either. What's the saying?--He who hesitates is lost! This may sound like a sales pitch or scare tactic, but all I'm saying is that we're likely to see some version of this happen. I think we're better off receiving a warning to consider than no warning at all.
Go camping more--have more fun! Lee
What many may not know is that Spartan is also is big in the emergency vehicle business. They build firetrucks, custom ambulances and other emergency vehicles for cities across the U.S. Since 2005, Spartan has been a major player in chassis components for military vehicles. They are now a key supplier for the Mine Resistant Ambush Protected program and the Iraqi Light Armored Vehicles.
This is conjecture on my part, but I would think that the government contracts are much more lucrative than the RV market as well as more reliable. In the current administration, what's easier than government money? It makes good business sense to follow the easy money. Hey, when Katrina hit, I was more than happy to sell all my new travel trailer inventory to FEMA at retail!
My point is that Spartan may focus on its military business and RVs may take a back seat. Competitors may also play a role. Some manufacturers are getting into the chassis business. Would Monaco consider selling their Roadmaster chassis to competitors? Doubtful, but who knows as they struggle coming out of bankruptcy? How about Freightliner? Are they ready to go after RV manufacturer's business they've lost such as Newmar?
Newmar's supply of Spartans with the more desirable engines without the new 2010 restrictions is dwindling rapidly. There is a finite number of engines available and Spartan may not have enough to satisfy demand. Newmar may have to look elsewhere and I'm sure, as one of the winners in the RV carnage we saw in the past year, they will have some courtship encounters. This could be bad news if you're a Spartan fan.
If you're considering a diesel pusher in the near future and want a Spartan chassis, you should strongly consider getting a chassis availability count from me or your dealer. Why take a chance on being left out in the cold after finding out the chassis or engine you want is unavailable when you're ready to pull the trigger?
We're seeing more and more buyers kicking themselves that they can't get some of the same deals offered a year ago when the RV market was reeling. When we miss out on a great thing, it's easier still to miss out on a very good thing. For example, it's tough to admit you should have bought that downtrodden stock and then keep missing out as the stock continues to rise. Wow! I could have bought it at $2 and now it's $8!--and quite possibly on its way to $25.
I think we will be seeing soon the second leg of non-buyer's remorse as the manufacturers sell out of the old engines and be forced to buy the new EPA guideline engines at much higher cost and maintenance. Also, the chassis of choice may not be available, either. What's the saying?--He who hesitates is lost! This may sound like a sales pitch or scare tactic, but all I'm saying is that we're likely to see some version of this happen. I think we're better off receiving a warning to consider than no warning at all.
Go camping more--have more fun! Lee